Should you buy investment property after the 2026 Budget?

The short answer: A Budget headline should only change your property decision if it changes one of three answers: whether you have the equity or deposit, whether you can carry the property at higher repayments, and whether it moves you closer to your goals. I bought after the 2026 Budget and kept more than $100,000 aside, capital that sits idle.

Why many buyers stepped back after the 2026 Budget

I’m a buyers agent, and I signed the contract on an investment property after the 2026 federal Budget. I still doubted whether I should.

The Budget announced changes to how negative gearing applies to some purchases, and a new capital gains tax regime from July 2027. Rates rose through 2026 and inflation stayed elevated. Commentary on every kind of investing got louder.

A lot of people who were ready to buy stepped back, and it felt like the responsible move. For some of them it was. What settled my own decision was a checklist built on my own position, which doesn’t ask me to forecast anything.

Three questions decide whether to buy or hold

Before I buy, I ask three questions:

• Do I have equity or deposit available?
• Are my cash flows in order?
• Does this purchase move me closer to my goals, given the assets and income my portfolio needs, or am I better to hold and consolidate debt?

The first is about capital I have today. The second is about whether I can carry the property, including at higher repayments.

I never model on negative gearing, for myself or for clients. Rules change, as the 2026 Budget showed, and I want a property to hold up without the deduction.

Being able to buy is a different question from whether you should

The third question tests the purchase itself. A yes on the first two tells me I can buy. Whether I should is a separate question.

I model it against my goals and the overall assets and income the portfolio needs. If adding the property moves me closer, it belongs. If it moves me further away, holding and reducing debt is the better call.

How the three questions played out on my purchase

For me, the answers supported buying. When the doubt came back, I returned to my long term plan, and adding this property moved me closer to my goals where holding would not have.

I also kept more than $100,000 aside as a buffer to cover my portfolio. That figure reflects my portfolio. The right buffer for yours depends on your own commitments.

A tax change alters your after tax position. That is a question for your accountant, and I’m not one. How to structure or consolidate debt belongs with a licensed mortgage broker, and wider wealth planning belongs with a licensed adviser.

Buying and waiting both carry a cost

That buffer is capital sitting idle instead of working, and I accepted that cost. Buying committed more of my capital and kept the plan moving. Holding and consolidating would have paused it.

Buying also carries risk. Rates could rise again, and the after tax position on a property bought after the Budget may be weaker than under the old rules. The buffer and the stress test on repayments are how I carry that risk.

Waiting carries its own risk, which is waiting for the headlines to settle. They don’t. There is always another rate decision or policy change coming, and nothing says conditions improve while you wait.

A headline only matters if it changes one of your answers

This suits someone who can answer yes to the first two questions and is weighing a purchase in the next 6 to 12 months. If either answer is no, that input is the one to work on first, with your broker or accountant where it touches finance or tax. If the third answer is no, holding and consolidating debt is a legitimate option to weigh against your plan and goals.

A real no on any of the three is a reason to pause on that input. A headline is not.

Which of the three would you answer no to today?

Frequently asked questions

Should the 2026 Budget changes stop me buying an investment property?

Only if they change one of your answers to the three questions. A tax change alters your after tax position, and that is a question for your accountant.

How much cash buffer should I keep when buying an investment property?

There is no single figure. I kept more than $100,000 aside for my own portfolio, and the right buffer for yours depends on your own commitments.

Is holding and consolidating debt a valid alternative to buying?

Yes. If a purchase would move you further from your goals, holding and reducing debt is the better call, and how to structure or consolidate debt belongs with a licensed mortgage broker.

Planning your next purchase? Here is how I work with property investors.

Disclaimer: The information in this article is general in nature and does not take into account your personal objectives, financial situation, or needs. It is not financial, legal, or tax advice. The Nelis Group accepts no liability for actions taken based on this content. You should seek independent advice from a relevant licensed professional before making any decisions and always confirm the latest rules and thresholds with your state revenue office or relevant authority.

‍